AN ANALYSIS OF THE FACTORS INFLUENCING THE DEMAND FOR CATASTROPHE INSURANCE
AN ANALYSIS OF THE FACTORS INFLUENCING THE DEMAND FOR CATASTROPHE INSURANCE

Summary/Abstract: This paper approaches the issue of insurance demand for catastrophic risks. Given the impact of these extreme events, the upward trend both in terms of frequency and severity a low level of the degree of insurance coverage can be observed. This is not a characteristic for Romania but rather a global problem. Our goal is to identify the main factors that influence a person’s decision to switch from uninsured to insured based on the analysis of the models already developed. Then we will focus on the Romania’s situation when it comes to regulations of covering the three catastrophic risks: earthquake, flood and landslides. Based on data regarding compulsory household insurance, through a regression analysis we’ll identify the factors that are taken into account by the clients when they decide to transfer the risk by buying an insurance policy. Furthermore we’ll present some elements that can lead to a higher insurance coverage. An important aspect is a different premium for the compulsory insurance by considering the exposure to risk.

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